What is the pretax cost of debt, Business Management

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What is the pretax cost of debt

Shanken Corp. issued a 30-year, 10% semiannual bond 7 years ago. The bond currently sells for 108% of its face value. The company's tax rate is 35%. Using Excel,

a. What is the pretax cost of debt?

b. What is the aftertax cost of debt?

c. Which is more relevant, the pretax or the aftertax cost of debt? Why?

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